Insurance Against the Risk of Default on a Credit Issued by a Foreign Bank

Eximgarant of Belarus offers an insurance product to ensure a foreign bank’s loss cover in case of borrower’s (resident of the Republic of Belarus) non-performance of their obligations under a credit contract. Hence, insurance policy issued by Eximgarant of Belarus for foreign banks is a collateral for their counterparties’ performance of obligations. 

A mandatory condition for insurance against the risk of default on a credit issued by a foreign bank is the establishment of a waiting period (from 30 up to 90 calendar days) and the Insured’s participation in covering potential losses (unconditional deductible no more than as a 15 % of the amount of loss).

Procedure of interaction:

1.      Conclusion of an export contract;

2.      Conclusion of a credit contract;

3.      Conclusion of an insurance contract.

4.      Delivery of products in accordance with the terms of an export contract;

5.      Foreign buyer’s payment of the delivered products;

6.      Resident’s default on a credit;

7.      Payment of insurance indemnity and transfer of the right of claim to Eximgarant of Belarus;

8.      Submitting a request against the resident.

 Documents required to conclude an insurance policy:       

·         Application for Insurance Policy;

·         The Insured’s title documents;

·         Credit contract with its documentation;

·         Borrower’s title and financial documents;

·         Agreements concluded to ensure the performance of obligations under a credit;

·         Other documents required to determine the risk level and decide on the conclusion of an insurance policy.

Procedure for the Insured to follow upon the occurrence of an accident that may constitute an insurable event under the terms of insurance policy:

To receive insurance indemnity, the Insured is obliged to apply to the Insurer for an insurable event no later than 30 calendar days after the end of the waiting period specified by insurance policy, enclosing the following documents:

·         Original version of an insurance policy;

·         Documents confirming the fact and amount of losses;

·         Documents confirming actions taken to avoid and/or reduce potential losses;

·         Borrower’s written explanation on the reasons of default on a credit;

·         Copy of a judicial decision in case of a borrower’s bankruptcy;

For inquiries regarding this line of business, contact the Export Credit Insurance Department or any Eximgarant of Belarus’s branch:Tel/Fax: +375 (17) 371-00-65.